Coshott v Prentice

Case [2013] FCA 1196

FEDERAL COURT OF AUSTRALIA

Coshott v Prentice [2013] FCA 1196

Citation: Coshott v Prentice [2013] FCA 1196
Parties: LJILJANA COSHOTT and SCHLOTZKY'S NOMINEE COMPANY PTY LIMITED v MAXWELL WILLIAM PRENTICE (IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT), ROBERT GILBERT COSHOTT, A BANKRUPT and JAMES COSHOTT
File number: NSD 2016 of 2013
Parties: FEWIN PTY LIMITED ACN 051 132 453 v MAXWELL WILLIAM PRENTICE (IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT), LJILJANA COSHOTT
File number: NSD 2140 of 2013
Judge: PERRY J
Date of judgment: 14 November 2013
Catchwords: COSTS – whether to be assessed on an indemnity basis – discussion of principles governing the award of indemnity costs
Legislation: Bankruptcy Act 1966 (Cth) s 30
Federal Court of Australia Act 1976 (Cth) ss 37M, 37N, 43
Federal Court Rules 2011 (Cth) r 36.08
Cases cited:

Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225
Coshott v Coshott [2013] FCA 907
Coshott v Prentice [2013] FCA 1085

Coshott v Prentice [2013] FCA 1036

Hamod v New South Wales (2002) 188 ALR 658

Dates of hearing: 21-22 October 2013
Date of last submissions: 22 October 2013
Place: Sydney
Division: GENERAL  DIVISION
Category: Catchwords
Number of paragraphs: 30
Counsel for the Applicant: Mr D Murr SC and Mr W Washington
Solicitor for the Applicant: Shana Radnan & Co Pty Limited
Counsel for the First Respondent: Mr J Johnson
Solicitor for the First Respondent: Sally Nash & Co Lawyers
Counsel for the Second Respondent / the Appellant: Mr R Carey
Solicitor for the Second Respondent / the Appellant: Spencer Whitby & Co Legal

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 2016 of 2013
BETWEEN:

LJILJANA COSHOTT
First Appellant

SCHLOTZKY'S NOMINEE COMPANY PTY LIMITED
Second Appellant
AND:

MAXWELL WILLIAM PRENTICE (IN HIS CAPACITY AS TRUSTEE OF THE PROPERTY OF ROBERT GILBERT COSHOTT, A BANKRUPT)
First Respondent

ROBERT GILBERT COSHOTT, A BANKRUPT
Second Respondent

JAMES COSHOTT
Third Respondent

JUDGE:

PERRY J

DATE OF ORDER:

14 NOVEMBER 2013

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The first appellant and Fewin Pty Ltd ACN 051 132 453 are jointly and severally liable for the costs of the first respondent on an indemnity basis for the interlocutory applications made in this proceeding and dismissed by this Court on 31 October 2013.

2.The taxation of the costs, if not agreed, be conducted by a taxing officer under the Federal Court Rules 2011 on the basis of common costs incurred on or after 21 October 2013 between proceeding NSD 2016 of 2013 and NSD 2140 of 2013 in respect of the three applications for a stay dealt with in the judgment delivered on 31 October 2013 and following such assessment apportioned 50% in respect of proceeding NSD 2016 of 2013 and 50% in proceeding NSD 2140 of 2013.

3.Leave be granted for the first respondent to proceed to taxation of the costs forthwith.

Note:Entry of orders is dealt with…

Continue reading Coshott v Prentice

Sign in free to access the full text

Details
AGLC
Coshott v Prentice [2013] FCA 1196
Case
[2013] FCA 1196
Decision Date

CaseChat Overview and Summary

In the case of Coshott v Prentice, the parties were involved in a dispute over the assessment of costs following a series of interlocutory applications made in the Federal Court of Australia. The applicants, Fewin and Ljiljana Coshott, sought to stay certain proceedings, which were subsequently dismissed. The legal issues before the Court centred around the appropriateness of awarding indemnity costs against the applicants and the trustee, and the method of apportioning these costs between the parties involved. The Court was required to consider the principles governing the award of indemnity costs, particularly in light of the applicants' failure to provide evidence of the harm they would suffer if the stay was not granted.

The Court found that it was unreasonable for Fewin and Ljiljana Coshott to have subjected the trustee to the expenditure of costs in responding to their various applications. The Court held that the applications should not have been brought and, as a result, an award of indemnity costs should be made against Fewin and Ljiljana Coshott in favour of the trustee. In determining how costs should be apportioned, the Court took into account the fact that all three applications for a stay were heard together, and that Fewin's application for a stay in the appeal proceedings was made to guard against the possibility that its application in the Fewin proceedings was incompetent. The Court also noted that Fewin's submissions were adopted by Ljiljana Coshott in support of her application for a stay and supplemented only in limited respects.

The Court concluded that it was appropriate to make orders apportioning costs 50/50 between Fewin and Ljiljana Coshott, with both parties being jointly and severally liable for the trustee's costs on the applications brought within the Coshott proceeding. The Court further ordered that the first appellant and Fewin Pty Ltd ACN 051 132 453 were jointly and severally liable for the costs of the first respondent on an indemnity basis for the interlocutory applications made in this proceeding and dismissed by this Court on 31 October 2013. The taxation of the costs was to be conducted by a taxing officer under the Federal Court Rules 2011 on the basis of common costs incurred on or after 21 October 2013, and apportioned 50% in respect of proceeding NSD 2016 of 2013 and 50% in proceeding NSD 2140 of 2013.

Orders

Orders of the court

1. The first appellant and Fewin Pty Ltd ACN 051 132 453 are jointly and severally liable for the costs of the first respondent on an indemnity basis for the interlocutory applications made in this proceeding and dismissed by this Court on 31 October 2013.

2. The taxation of the costs, if not agreed, be conducted by a taxing officer under the Federal Court Rules 2011 on the basis of common costs incurred on or after 21 October 2013 between proceeding NSD 2016 of 2013 and NSD 2140 of 2013 in respect of the three applications for a stay dealt with in the judgment delivered on 31 October 2013 and following such assessment apportioned 50% in respect of proceeding NSD 2016 of 2013 and 50% in proceeding NSD 2140 of 2013.

3. Leave be granted for the first respondent to proceed to taxation of the costs forthwith.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

1. The applicant is to pay the costs of the first respondent on an indemnity basis for the interlocutory application made in this proceeding and dismissed by this Court on 31 October 2013.

2. The taxation of the costs, if not agreed, be conducted by a taxing officer under the Federal Court Rules 2011 on the basis of common costs between proceeding NSD 2016 of 2013 and NSD 2140 of 2013 incurred on and from 21 October 2013 in respect of the three applications for a stay dealt with in the judgment delivered on 31 October 2013 and following such assessment apportioned 50% in respect of proceeding NSD 2016 of 2013 and 50% in proceeding NSD 2140 of 2013.

3. Leave be granted for the first respondent to proceed to taxation of the costs forthwith.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Thirdly, notwithstanding the observations of the Court on the earlier stay application in Coshott v Prentice [2013] FCA 1036 at [46]-[47], the applicant again led no evidence as to the harm that she would suffer in the event that the stay was not granted. She was already on notice by those reasons that it was not necessarily sufficient if a serious case of detriment was to be run, to rely merely upon the obvious detriment of being required to leave the family home. Nor was any evidence led as to the state of the property, or the capacity of Ljiljana Coshott or of the other appellant to maintain and insure the property if a stay was granted, or of their ability to cover all relevant taxes and the like. As such, Ljiljana Coshott sought to invoke the jurisdiction of the Court to act to protect her interests against harm, without taking any steps to inform the Court as to the extent and nature of that harm or her capacity to protect the trustee’s interest in the property.5. CONCLUSION For the reasons set out above, I am satisfied that it was unreasonable for Fewin and Ljiljana Coshott to have subjected the trustee to the expenditure of costs in responding to their various applications. I do not consider that the applications should have been brought. As a result, I consider that an award of indemnity costs should be made against Fewin and Ljiljana Coshott in favour of the trustee. Furthermore, in determining how costs should be apportioned between Fewin and Ljiljana Coshott, I have taken into account that:a) all three applications for a stay were heard together;b) in both the Fewin and Coshott proceedings, Fewin sought orders in the same terms, relied upon the same evidence and made substantive submissions to the same effect;c) Fewin’s application for a stay in the appeal proceedings was made to guard against the possibility that its application in the Fewin proceedings was incompetent in light of issues that arose during the hearing on 21 October 2013;d) the submissions put by Fewin focused upon whether ground 3A of the further amended notice of appeal in the Coshott proceedings was arguable; and e) Fewin’s submissions were adopted by Ljiljana Coshott in support of her application for a stay and supplemented only in limited respects. These factors in my opinion make it appropriate to make orders apportioning costs 50/50 as between the two proceedings, save that it should be clear from the terms of the two sets of orders that no liability for costs in relation to the Coshott proceedings arose until the commencement of the hearing of the Fewin proceedings on 21 October 2013 when an application for a stay was made in the Coshott proceedings by Ljiljana Coshott. It is also appropriate in light of these factors, in my opinion, to make Fewin and Ljiljana Coshott jointly and severally liable in relation to the trustee’s costs on the applications brought within the Coshott proceeding notwithstanding that Fewin did not make its application in the appeal until 22 October 2013.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.